U.S. and China Outline TikTok Framework as Leaders Prepare Confirmation Call
After two days of talks in Madrid, negotiators say they have a framework that would keep TikTok operating in the U.S. The outline awaits a call between President Trump and President Xi and comes as Beijing pushes for a Trump visit and escalates scrutiny of a major U.S. chip maker.
Executive Brief
- Framework reached: U.S. and Chinese teams agreed on a structure to keep TikTok operating in America, pending a leaders’ call.
- Ownership shift: The plan centers on transferring ownership to an investor consortium; detailed commercial terms remain private.
- Algorithm question: It is unclear whether China will permit divestment or licensing of TikTok’s recommendation algorithm, which sits on Beijing’s export-control list.
- Beijing’s calculus: Sources tie China’s new flexibility to its effort to secure a Trump visit; regulators also announced a probe of a leading U.S. chip firm during the talks.
- Deadline stance: Officials indicated they do not intend to grant repetitive extensions; time will be provided to finalize paperwork under the agreed outline.
What Happened
Treasury Secretary Scott Bessent said a framework is in place and that the presidents plan to confirm it on Friday. Negotiators described the Madrid sessions as candid and detailed, with meetings running late Sunday and about six hours on Monday. Chinese representatives publicly characterized the talks as constructive and said the framework resolves key TikTok issues in principle.
Deal Outline & Open Items
- Ownership change: A consortium would take a significant stake in TikTok to satisfy U.S. national-security requirements.
- Participants: Blackstone is no longer expected to join, according to people familiar; Oracle remains relevant due to its existing data-hosting role.
- Data controls: Governance, auditing, and localization requirements are expected to mirror an April concept reviewed by U.S. officials.
- Algorithm: Still unresolved—transfer, license, or technical workaround must comply with China’s export rules.
- Timeline: Company receives time to document terms under the framework rather than seek further deadline extensions.
Context & Dynamics
- Shift from resistance: Beijing had resisted a sale of ByteDance’s controlling stake; flexibility emerged alongside efforts to secure a high-profile U.S. visit.
- Parallel pressure: China’s antitrust authority announced a preliminary finding against a U.S. chip company tied to a 2020 acquisition—seen by some as political cover at home.
- Broader agenda: The framework sits within wider negotiations on tariffs, fentanyl precursors, and agricultural purchases that remain unsettled.
Political Backstory
The administration signaled in January it would not enforce an immediate shutdown while talks proceeded, even as national-security concerns persisted. Advisers encouraged outreach to younger audiences on short-form platforms during the election cycle, and the White House launched an official TikTok account last month.
What to Watch Next
- Leaders’ call confirming the framework and authorizing legal drafting.
- Public details on governance, auditing, and data-localization safeguards.
- Final treatment of the recommendation algorithm under export-control rules.
- Whether progress on TikTok unlocks scheduling for a Trump–Xi summit and movement on tariffs or fentanyl-related talks.
